To facilitate domestic defence productions, Defence Minister Rajnath Singh recently approved Defence Testing Infrastructure Scheme (DTIS) with an outlay of Rs 400 crore. It aims to develop testing facilities for private-sector defence and aerospace companies.
The DTIS will run for the next five years and is set to provide financial assistance to the private sector in setting up six to eight common testing and certification facilities for individual manufacturers of defence equipment. According to the structure of the scheme, each project under it will get funding equal to 75% of the cost from the Government in the form of ‘Grant-in-Aid’. The other 25% of the cost, has to be borne by the Special Purpose Vehicles (SPVs), which constitute the Indian Private entity and the respective state governments. These SPVs shall be registered under the Companies Act 2013 and will have the responsibility to maintain all assets under the scheme in a self-sustaining manner.
The Majority of the testing facilities are expected to be set up in the Defence Industrial Corridor (DIC), although the Defence Ministry, with a circular, clarified that the scheme extends beyond the two DICs of India.
Last year, Finance Minister Nirmala Sitaraman had set up a Defence Industrial corridor in Uttar Pradesh and one in Tamil Nadu. These corridors are supposed to facilitate a well-planned and efficient industrial base, which would increase domestic production of defence equipment. The corridor overlapped the existing defence public sector companies, further ensuring connectivity among various defence industrial units.
This new scheme seems to work in hand with the DICs and help the process of making India self-sufficient in terms of defence equipment. The strong dependence on imports for defence products from India results to a negative trade balance.
One of the main impediments in the domestic production of defence equipment in India are the lack of state of the art testing facilities, which help defence industrial units to validate and accredit their new weaponry. Defence testing infrastructures are capital intensive and require constant upgradation, thus it is always not possible for individual units to have in-house testing facilities. This scheme is, thus, to bridge these existing gaps by providing common Greenfield testing infrastructure to micro, small, and medium enterprises, and even start-ups which would further increase the domestic capabilities of India.
The Government has given high priority to the development of the manufacturing base of the defence and aerospace sector under its Make in India initiative. Such an initiative would reduce India’s dependency in matters of defence and will considerably bring down the high defence expenditure India is currently forced to make. Thus, the DTIS scheme is one of the schemes that seek to establish self-reliance, not only by helping India to become a major military power in the world, but also by aiding India’s economy.